Findings

55 We now turn to consider how the standards which we have identified in the preceding section of our report have been applied in practice in the Defence Force and the Ministry of Defence. We address our findings under the following headings -

(a) Standards governing relationships with and obligations to the Government of the day.

(b) Training in the application of standards governing senior Service personnel relationships with Government.

(c) The issue of higher loyalty.

(d) Standards of behaviour in respect of handling official information.

(e) The scale of the unauthorised release of official information.

(f) Action taken by CDF to review leaking and adequacy of his action.

(g) Action taken by Secretary of Defence to review unauthorised disclosures, and adequacy of his action.

(h) Why did the unauthorised leaks occur?

56 As we have already noted, staff of the Ministry of Defence are bound by the provisions of the Public Service Code of Conduct, which is distributed to all staff on taking up appointment. Standards relating to a number of the matters dealt with in the Public Service Code have been incorporated in various documents issued as Defence Force or Service Orders, especially in relation to the handling of official information. The written guidance or standards governing the relationship of Defence Force personnel with the Government is likewise spread across a number of separate documents. We have noted in particular DFO 34 relating to Defence Force Headquarters Organisation which deals with the powers and functions of the principal offices and institutions of State; but this is more a constitutional statement than a ready guide to the standards which should guide the Defence Force's relationship with and loyalty to the Government of the day. We formed the view that, in this area, the guidance available to Defence Force personnel was less comprehensive, less explicit and more fragmented than what has been produced for public servants.

57 Programmes and documents have been developed in the individual Services, to underpin the training that all their members receive in core values. These are intended to reinforce such attributes as respect for the traditions of their parent Service, professionalism, loyalty, discipline and teamwork which are of great importance to effective operation of the Defence Force. Indeed these core values constitute the basic foundation for the effective operation of the Force and it is vital that they be universally respected. But they do not set out to cover in any comprehensive way the proper relationship between Service personnel and the Government of the day. There are some short references to these matters, although the precise sense may not always be clear, as for example in the Army's "Ethos and Values" in describing service to the Crown -

"The Armed Forces have a special constitutional position where the members are engaged to serve at the pleasure of the Sovereign. This service is carried out regardless of the political stamp of the Government and is reinforced by the Oath of Allegiance, commissions and warrants."

This may or may not be interpreted as a commitment of loyalty to the Government of the day, although the Chief of General Staff claimed that there is no ambiguity - that personnel are on oath to serve the Government of the day.

58 Similar ambiguity characterises the attempt in the Navy's Command Management and Divisional Manual to describe in flow-chart terms the relationship between Government and Defence Force (see Appendix 7). This diagram might well leave the reader with an exaggerated impression of the role of the Governor-General and a diminished view of the relative importance of Cabinet and the Minister of Defence (leaving aside the curious placement of Parliament). We return later to the matter of the Governor-General's role.

59 It was suggested to us by one officer that his commissioning parchment, which absolutely informed his conduct, contained all that was required in the way of directions on his responsibilities to the Government of the day - but this basic document is concerned entirely with respect for the orders of his superior officers, and duties towards subordinates.

60 There seems to us to be a need for a single document, unambiguously expressed, incorporating a code of conduct for distribution to all members of the Defence Force. Such areas as the need for loyalty to the Government, and for political neutrality on the part of Force members, could be given appropriate emphasis. The Public Service Code dealing as it does with general behavioural issues as well as with the proper handling of official information provides a commendable model. Officers of the Defence Force are not public servants, and we do not see it as desirable that they should be. ⁷ But, like all parts of the Public Service, the Defence Force is responsible to a Minister for giving advice and implementing Government decisions. The Government of the day is entitled to expect the same level of honest, impartial and comprehensive advice from the Defence Force as from the public service. And it is entirely appropriate that the same standards of conduct should apply to the Government's principal civilian and military defence advisers (and their subordinates) particularly when they are required to consult with each other in giving advice on major policy issues. We recognise that the State Services Commissioner's document might well need some adaptation to the special requirements of the Defence Force. We suggest in our Conclusions a method by which this might be done.

61 The Civil Staff Code of Conduct issued by the Chief of Defence Force in 1997 contains a number of cogent requirements of acceptable behaviour, but they are expressed as obligations to the Defence Force rather than to the wider context we are addressing. It does not (nor purports to) deal with the basic issues of political neutrality and loyalty to the Government of the day which are properly highlighted in the Public Service Code. There is therefore a gap to be filled and the suggested new Defence Force Code of Conduct, applied to them, would provide this.

62 Senior officers of the Defence Force have normally been exposed to higher levels of training as they pass through the ranks. Such training includes enhancement of understanding of their proper relationship with the Government of the day. We witnessed a slide lecture presentation by the Defence Force Director of Legal Services, regularly given at the RNZAF Staff College at Whenuapai (but open to the other Services). In this example, it was made clear, eg, that -

"The Defence Force and the disposition of those Forces are at the decision [sic] of Her Majesty's Ministers for the time being"

And that

"The Minister of Defence shall have control of the NZDF, which shall be exercised through the Chief of Defence Force."

We were told that these bare statements normally formed the basis for extended discussion.

63 More advanced study of the proper relationship between Government and Armed Forces is included in post-graduate courses undertaken by NZDF officers at staff colleges in a number of overseas countries, as well as New Zealand, and at such institutions as the Massey University Centre for Defence Studies.

64 Since not all officers have access to these levels of training, we see merit in the organisation of special courses of perhaps 1-2 days' duration aimed at expanding understanding of the standards which should govern civilian/military relationships, and especially the convention of political neutrality which should govern the relationships between the Defence Force and the Government of the day. We believe that such a systematic approach would bring considerable benefit, and alleviate any areas of tension and uncertainty. But, as we observe later, no system of instruction would have prevented the deviant practices which have been the subject of our review: the individuals concerned were generally considered by those who addressed us on the subject to have been fully aware that their activities were in breach of the expected norms of conduct.

65 Our experience in interviewing a number of Army officers in connection with our investigation into Mr Mark's allegations of misuse of his personal files suggested a further area in which training might be enhanced. There are times when Service personnel, who may be of relatively senior rank, are posted to sensitive positions in Service or Defence Force Headquarters immediately following long periods of service in overseas or even remote New Zealand locations. Several of these officers, and others whom we questioned on the point, thought that it would be helpful to them, and to their Services, if their Wellington positions were to be preceded by a short "refresher course" bringing them up to date with a range of pertinent issues outside their immediate professional experience, including some political orientation. We think this suggestion merits further consideration.

66 In our preliminary briefing for the review, and in some of our interviews outside the Defence Force, we were told that it was not uncommon for members of the Force to insist that their loyalty was not necessarily to the Government of the day, but to a higher authority - the Sovereign, to whom all Service personnel swear an oath of allegiance; Her Representative in New Zealand who is, by statute, their Commander in Chief; or simply the Nation. This principle was believed to justify efforts to overturn or frustrate the implementation of Government policies seen as inimical to the country's security. None of those who passed these reports to us had had such assertions put to them directly by Defence Force officers; but all had received accounts of conversations in which such claims had been made.

67 In most of our interviews with Defence Force personnel, we asked specifically whether the conduct of they themselves, or, to their knowledge, others in the Force was governed or influenced by the "higher loyalty" principle. In all cases, except for one middle-ranking officer, we received firm denials. There was virtual unanimity that, while their oath of allegiance was to the Sovereign, their loyalty was solely to the Government of the day. Many seemed bemused that the question should even have been asked, over what they regarded as a non-issue.

68 We do not think there is any doubt that members of the Defence Force know that their loyalty is owed to the Government of the day, and that, once decisions have been taken by that Government, they must be faithfully implemented. That does not seem to us incompatible with the sense of duty to the nation that motivates service men and women to place their lives at the ultimate risk in New Zealand's defence.

69 It was recognised in a number of our conversations that the argument of higher loyalty may well have been deployed as a rationalisation - or, as one interviewee put it, a "refuge" - by some Defence Force officers who embarked on actions they knew to be politically partisan or in defiance of Government policy. But we do not believe that it was a significant element of motivation.

70 Although we do not judge that there is any serious ambiguity in the matter, in our Conclusions we address the statutory role of the Governor-General as Defence Force Commander in Chief. The powers of that office in New Zealand (quite unlike those of, say, the US President as Commander in Chief) are strictly limited in scope. We suggest that clearer statutory definition of the Commander in Chief's role and powers would remove any grounds for misinterpretations, deliberate or otherwise.

71 Our terms of reference require us to address three questions under this heading -

71.1 Do senior Defence personnel have clear standards for handling official information?

71.2 How do Defence personnel view the leaking of documents and information?

71.3 Why would Defence personnel leak documents?

We address our findings in respect of each of these questions in turn.

(i) Defence Force standards for handling official information

72 Both the Defence Force and the Ministry of Defence have adopted comprehensive guidelines for handling official information. The Defence Force has a series of Defence Force Orders promulgated by respective Chiefs of Defence Force under s 27 of the Defence Act relating to the handling of official information. For our purposes the relevant Defence Force Orders currently are -

72.1 Defence Force Order 51 relating to Security;

72.2 Defence Force Order 70 relating to Official Information;

72.3 Defence Force Order 5/1999 relating to NZDF External Relations;

72.4 Defence Force Order 20/2000 relating to the Protected Disclosures Act 2000.

73 We have examined the relevant provisions of Defence Force Order 51 relating to Security. We have also referred them to the Director of the New Zealand Security Intelligence Service for comment. Subject to his confirmation that there is nothing in the Order inconsistent with the Security Manual, we are satisfied that Defence Force Order 51 contains clear standards for the handling of official information relating to the security and defence of New Zealand.

74 We have considered whether senior Defence personnel, who have access to official information relating to the security and defence of New Zealand, appreciate the critical importance of compliance with the standards in Defence Force Order 51. We believe that they do, not least because, significantly, as recorded in paragraph 94, none of the unauthorised disclosures of official information which we have been asked to consider relates to such information. We address this important finding further in our report.

75 We have examined the provisions of Defence Force Order 70 relating to Official Information. We have also referred them to the Ombudsmen for comment. Subject to their confirmation, we are satisfied that Defence Force Order 70 contains clear standards for the handling of official information. The introduction to the Defence Force Order contains a concise and accurate summary of the position

A.  publish or disclose in any form whatever outside the New Zealand Defence Force any official information which he or she has acquired or to which he or she has access.

B.  use other than in the course of duty any official documents or their contents or any other official information.

- unauthorised disclosure of information.

Section 25 Armed Forces Discipline Act 1971

Section 78 Crimes Act 1961 - espionage.

Section 78A Crimes Act 1961 - wrongful communication, retention, or copying of official information.

Section 105A Crimes Act 1961 - corrupt use of official information.

Section 20A Summary Offences Act 1981 - unauthorised disclosure of certain official information.

• This Manual prescribes the procedures for the handling of official information by all service and civilian personnel within the New Zealand Defence Force. The procedures are designed to provide for the proper implementation of the provisions of the Official Information Act 1982 and to ensure that necessary protection is given to official information.
• Where any request for official information is received from any person, it is to be handled in accordance with the provisions of this Manual.
• Defence Force Orders for the Navy, Army and Air Force prescribe the procedures to be followed for releasing official information to the news media, publishing books and articles, and delivering public speeches, lectures and radio addresses. Personnel are authorised to release official information to the extent authorised and for the purposes specified in those Orders.
• Official reports, correspondence, and documents of whatever description, whether classified or not, are the property of the Crown. The only authorised use which personnel may make of official documents, or information derived from them, is in the performance of their duty.
• Except as authorised in paragraphs 2 - 4 above no service or civilian employee shall:
• All personnel are reminded that there are special provisions in New Zealand law relating to the misuse of information. They are:
• Defence Force Orders for the Navy, Army and Air Force are to draw the attention of all personnel to the provisions of this Manual.

76 The obligation to protect official information from unauthorised disclosure is mandatory ⁸ and is also mentioned in paragraph 1101 of the Order and paragraph 8 of Annex A to Chapter 1 of the Order which is required to be placed in unit or branch orders once every three months as a routine order. The prohibition on unauthorised disclosure is reinforced in respect of communications to the news media by Defence Force Order 5/1999 - "NZDF External Relations" - which we refer to later in our report because it was relied on specifically by the Chief of Defence Force.

77 We have examined the Defence Force Orders for the Navy, Army and Air Force referred to in paragraphs 3 and 7 of this introduction. They are based on Defence Force Order 70.

78 We have considered whether senior Defence personnel appreciate the significance of the obligations imposed on them by Defence Force Order 70 in respect of all official information. While we are reasonably satisfied that senior Defence personnel are aware in general terms of the nature of the obligation not to disclose official information unless authorised to do so, it is apparent that -

78.1 There has in recent years been a significant increase in the number of unauthorised disclosures of official information relating to the Defence Force;

78.2 The steps taken by the Chief of Defence Force to prevent this from occurring have not been successful; and

78.3 Some Defence personnel are therefore either unaware of the obligation or, notwithstanding the terms of Defence Force Orders 70 and 5/1999, which are explicit, have deliberately breached the directions and have disclosed official information without authority.

79 We discuss the reaction of the Defence Force to these breaches, the reasons for them and the adequacy of the steps taken by the Chief of Defence Force in respect of them later in this report. As we have already noted, unlike the Public Service which has easy access to its Code of Conduct, the Defence Force has not published a simple, straightforward statement of standards in respect of the protection and disclosure of official information. Instead the relevant instructions are contained in Defence Force Order 70 which is one of some 50 volumes of Defence Force Orders published in book form out of a total of some 128 current Defence Force Orders which relate to a wide variety of different subjects of varying degrees of importance. Furthermore, Defence Force Order 70 is concerned primarily with practices and procedures relating to the disclosure of official information under the Official Information Act 1982. The obligation to protect official information from unauthorised disclosure is mentioned in the Defence Force Order, but it is possible that its significance as a stand-alone obligation may not be fully appreciated by all members of the Defence Force. They may not understand that breach of the obligation may be an offence under s 39 of the Armed Forces Discipline Act 1971. The sanction for failure to comply with this aspect of the Defence Force Order is not mentioned in the Order. Certainly those who have been guilty of the unauthorised disclosure of official information in the Defence Force were not deterred.

80 Defence Force Order 5/1999 - "NZDF External Relations" - is concerned with unauthorised disclosures of information or news to the media. It does not address the issue of unauthorised disclosure to persons outside the media, such as Opposition members of Parliament. To this extent it might convey the impression that disclosure to such persons is not prohibited.

81 Production of a simple, straightforward statement in booklet form which among other things described clearly the obligation on all Defence personnel to avoid the unauthorised disclosure of official information to anyone, whether or not in the media, would promote understanding of responsibilities. Hence our advocacy of a code on the Public Service model covering both general behavioural issues and the handling of official information.

82 We have examined the provisions of Defence Force Order 20/2000 relating to the Protected Disclosures Act 2000. We are satisfied that it contains appropriate procedures for the implementation of the Act, but we have the following concerns -

82.1 The introduction to the Order does not make it clear that it reinforces the obligation to protect official information from unauthorised disclosure;

82.2 The procedure for making a protected disclosure within the Defence Force may not sit comfortably with the command structure; and Defence personnel may not be aware of its existence and potential significance.

(ii) Ministry of Defence standards for handling official information

83 The Ministry of Defence has issued the following relevant manuals to its staff -

83.1 Security Manual: Policy on Information Security

83.2 Security Manual: Document Security

83.3 Corporate Manual: Ministerial and Information Requests

83.4 Corporate Manual: Official Information Act Procedures

83.5 Legal Compliance Manual: Official Information

83.6 Public Service Code of Conduct

83.7 Human Resources Manual: Code of Conduct

83.8 Corporate Manual: Communication with the news media

83.9 Corporate Manual: Information Technology Management and Security

83.10 Protected Disclosures: Policy and Procedures.

84 We have examined the provisions of these Manuals. We are satisfied that in each case they contain clear standards for the staff of the Ministry. There has been no suggestion that these standards are not understood by Ministry staff.

(i) Analysis of unauthorised disclosures

85 We obtained from the Minister, the former Minister, the Chief of Defence Force and the Chief of the General Staff lists of alleged unauthorised disclosures of information. They covered not only the release of documents or the passing of information in briefing the media but also the provision of hints to members of Parliament as to what documents or information might profitably be sought via Parliamentary questions or Official Information Act requests. We referred the lists to the Chief of Defence Force and the Secretary of Defence for comment. Both of them drew our attention to the fact that inappropriate use of official information covers a broad spectrum of actions -

• Leaking, i.e. the deliberate and improper covert release of official information to advance a particular agenda or to embarrass.
• Unauthorised release, i.e. an intentional overt release of information outside approved guidelines that, because of its content, should not have been released from that organisation or person.
• Authorised but unwise release, i.e. release of information within approved guidelines but with the possibility of causing damage or embarrassment.
• Accidental release, i.e. the inadvertent release of information through carelessness.

86 We have analysed the list of possible unauthorised disclosures in the light of this approach. Of the 62 disclosures included on the lists provided by the Minister, Hon. Mark Burton (44), Hon. Max Bradford (4), and Major General Dodson as CGS (14, plus three also in Mr Burton's list), covering a period from April 1998 to October this year, 30 may be classified as 'probable leaks' in the terms above: "the deliberate and improper covert release of official information to advance a particular agenda or embarrass." Of the remainder, 15 may be categorised as 'unauthorised releases' (or unauthorised comments) and four as releases or comments that were 'authorised but unwise'. Most of the remaining 13 cases were either properly authorised releases or comments, or what we have termed 'speculative analysis', that is, journalistic or political comment based on a variety of generally legitimate sources - information obtained under the Official Information Act, and from earlier public comment, for example. In one case, pure mischief seems to have been at work.

87 It is the disclosures in the first category, the 30 'probable leaks', that are of most concern. Four of these 'probable leaks' occurred in Mr Bradford's time, three being to do with major impending procurement decisions (the Air Force's F16s, the Army's light armoured vehicles, and the Navy's third ANZAC frigate). The fourth related to the review of Defence real estate, where Mr Bradford noted a certain inevitability of disclosure given the protracted nature of the exercise and the number of people with interests at stake. In one of these cases the Secretary of Defence of the day initiated a Police inquiry, although this was cut short by Police operational requirements with no conclusions being drawn. Mr Bradford made the point that information in respect of at least six other sensitive Defence issues alive in his term as Minister (matters he may have considered potentially 'leak-worthy') was not disclosed.

88 The remaining 26 'probable leaks' have occurred during the term of the present Minister. The first significant case occurred in May 2000 and the most recent in October 2001. The first, relating to Project Sirius, prompted the present Secretary of Defence to initiate a formal inquiry. While this inquiry was appropriately comprehensive it did not identify a source. Only a few others have been followed up by a formal investigation, either by CDF or by the Chief of Staff concerned. Most of the 'probable leaks' since January 2000 have occurred since the middle of this year (19 of the 26). Almost all of these have been related to the Army, and/or to the CGS personally. Four earlier 'probable leaks' also related to the Army and/or the CGS.

89 Of the fifteen disclosures we have categorised as 'unauthorised releases/comments', most took place between the middle of last year and the middle of this year. Seven related to the Air Force, focusing mostly on morale and staff retention in the wake of Government decisions about its future role and structure. Some 'unauthorised releases/comments' appear to have been misguided contributions to aspects of the fairly lively public debate about defence matters. In the one case of an 'unauthorised release/comment' involving the Ministry of Defence the Secretary acted promptly and decisively, reprimanding the person concerned and issuing a general warning to his staff.

90 Our analysis of the items on the lists of possible unauthorised disclosures provided to us is summarised in the chart at Appendix 8. This shows the timing of the various disclosures over the last two years. Bearing in mind the definition of 'leaks' we have used ("...the release of official information to advance a particular agenda or embarrass"), we have indicated in the chart the institutions or individuals we suspect to have been likely 'targets' of the 'probable leaks'.

(ii) How Defence personnel view the leaking of documents and information

91 As we have already noted, the overall impression gained from our interviews was that there was widespread disapproval of the unauthorised disclosure of information which had led to our review. No one sought to argue that any of the leaks were justified. It is appropriate to note here, however, that from a large number of officers we heard the view that the establishment of the Joint Forces Headquarters this year would, by fostering the collaborative working of individuals from all three Services towards a common operational purpose, offer an important new opportunity to widen the understanding of individual officers of the issues facing their counterparts in other Services. If this view is borne out, the effect should be a significant reduction of the "win at all costs" approach to inter Service consideration of major re-equipping requirements, for example, which had sparked much of the aberrant behaviour we have been considering.

(iii) Absence of security leaks

92 Overhanging the emergence of a pattern of unauthorised disclosures plainly intended to advance particular interests within the Defence Forces, or to destabilise or embarrass individuals or embarrass Government itself, is the much more serious issue of national security. At a time when the country is contributing troops to a major international combat operation which involves, among other things, significantly expanded exchanges of highly-sensitive information with partner Governments, it is of even greater importance than usual that the integrity of New Zealand's systems for dealing with such material remains beyond reproach.

93 We sought reassurance from all those we interviewed - as a principal point of concern - that the spate of unauthorised disclosures of recent years had included no information whose release could have prejudiced New Zealand's security or defence interests, or its international relationships, or the Government's capacity to receive information in confidence from other Governments. We paid particular notice to the responses of those who, by virtue of their offices, would have certain knowledge of any such security breaches had they been identified.

94 The unanimous response to our inquiry was that, in these crucial areas, no breach was known to have occurred. We regard this as a most significant finding. The lapses in judgement, discretion and, indeed, loyalty which have been deemed sufficiently serious to justify this review appear to have done no damage to New Zealand's security interests or international relationships.

95 We asked a number of those interviewed if they considered that the evident disregard by some members of the Defence Force of the accepted standards of behaviour, in misusing official information of a domestically sensitive character, might be encouraging a general loosening of discipline in the handling of secure material. Again, the responses were reassuringly negative. It was the general perception that those members of the Defence Force who had been leaking the kind of information which is the cause of this inquiry, and who had done so for a particular purpose in full knowledge that they were acting outside the rules, would nevertheless see it as their duty to continue to treat classified information of a secure character with the respect due to it.

96 We have been asked to describe the action taken by the Chief of Defence Force to review the apparent "leaking" of information by Defence Force personnel and to indicate whether we consider that action was appropriate. In order to carry out this task we referred the lists of information believed to have been disclosed without authority provided to us by the current Minister of Defence, the former Minister and the Chief of the General Staff to the Chief of Defence Force and asked him to comment on the lists and in particular to advise us of the action taken at the time to review the various incidents.

97 In his response to us CDF stated that he did not consider that all of the incidents listed by the Minister constituted unauthorised disclosure of official information by Defence personnel. Many of the incidents involved speculative reporting based on "information" which could have been obtained from a variety of sources. He did not have the resources to investigate every incident of this nature. Nor did he consider that it would be worthwhile doing so. He will direct an investigation when he believes that there is "sufficient circumstantial evidence" to warrant the application of scarce resources and that such an investigation is likely to meet with a degree of success. Lengthy investigations have been conducted in the past three years, but in each case the outcome has been inconclusive. He considered that there was no reason why all investigations must be directed by him. Each single Service Chief of Staff has the authority to conduct his own investigation, where the "disclosed matter" is related to his Service.

98 CDF told us that he has regularly and formally enforced the standards to be applied to the protection of information and the guidelines for those who have authority to make information public via the media. He did this by way of a series of instructions designed to reinforce the restrictions on communications with the news media referred to in Defence Force Order 5/1999 - "NZDF External Relations" - which noted the establishment of a formal NZDF public relations structure and which contained explicit warnings about unauthorised communications with the media. Particular attention was drawn to paragraph 8 of the Order which reads -

"Because of the potential political consequences of remarks made in the absence of complete knowledge on an issue, NZDF personnel, whether uniformed or civilian, are forbidden to publish in any form whatever, or communicate directly or indirectly to the media or any other external organisation or individual, any Service information, or the individual's views on any Service subject, without specific authority."

99 The steps taken by the Chief of Defence Force to prevent the leaks from occurring and to investigate them subsequently have proved unsuccessful. To that extent they were, by definition, inadequate to ensure either that no breach of the obligation on Defence personnel to protect official information from unauthorised disclosure occurred or that the culprits were identified. But the Chief of Defence Force considers that he took all appropriate steps in the circumstances. And we have a measure of sympathy for his position because at the end of the day if a person is determined deliberately to disclose official information without authority, that person will do so whatever steps are taken.

100 At the same time, however, we consider that the Chief of Defence Force may have been unduly constrained by the command structure and reliance on the existence of Defence Force Orders and instructions, and the authority of the single Service Chiefs to investigate leaks in their own Services. In our view while the command structure is of fundamental importance to the Armed Forces in an operational context it may have its limitations in managerial areas such as enforcement of obligations relating to standards of behaviour or to the investigation of breaches of those obligations. Further steps to reinforce the importance of the obligations appear to be required. Reliance on the existence of Defence Force Orders and instructions - as an element of the command structure - will not suffice. We have already proposed the publication of a simple, straightforward statement along the lines of the New Zealand Public Service Code of Conduct to be made available to all serving personnel as one means of extending the reach of the Orders. But there are other forms of action which might be considered with the aim of enhancing the effectiveness of the command system in non-operational situations.

101 The view of the Chief of Defence Force that it was appropriate to rely on the authority of the single Service Chiefs to investigate leaks in their own Services reflects the constraints which affect the authority of the Chief of Defence Force in respect of the single Service Chiefs. In our preliminary report of 13 December 2001, paras 42 and 43.3, we identified this issue for further consideration. The constraints arise under the Defence Force structure created by the Defence Act 1990 which, in an operational command sense, makes the Chief of Defence Force paramount, but in a managerial sense makes him only first among equals because all are appointed by the Governor-General and the Chief of Defence Force has no authority to remove or suspend a single Service Chief. The Chief of Defence Force does not have the authority of a chief executive in respect of the single Service Chiefs. They are commanders in their own right in respect of their Service. The review being conducted by Mr Hunn provides a timely opportunity to consider how what seem to us to be structural ambiguities should be resolved.

102 The Secretary of Defence's response to the list of unauthorised disclosures compiled by the Minister, covering the period March 2000 - October 2001, noted that in only two cases were the examples quoted clearly the responsibility of Ministry staff, or involved misuse by others of material originating in the Ministry. On the first, comments intended to expand a journalist's technical understanding of capability were unauthorised. The staff member concerned was reprimanded for lack of judgement and for acting beyond his authority. All staff were reminded of the Ministry's policy on communication with the news media.

103 The second, more serious case concerned public release of confidential information about an acquisition project, provided to Ministers' offices and several Government departments. The Secretary initiated an inquiry into the matter by writing to the heads of the relevant departments, none of whom admitted responsibility. The Secretary does not believe that the information came from his Ministry, which had held it tight before the wider consultation. He has now made it standard practice for all staff members working on acquisitions projects to sign confidentiality agreements.

104 We are satisfied that the steps taken by Mr Fortune in response to these two incidents were appropriate.

105 The unauthorised release of information, commonly known as "leaking", provided the most obvious evidence of a pattern of unacceptable behaviour within the Defence Force which was of even greater concern than the leaking itself. While leaking of official information had occurred often enough in preceding years - both from the Armed Forces and from other Government agencies, and generally to the media - the pattern during the years 1997-2001, on the part of the Defence Force seems to have been more substantial, more complex in character and range than earlier, and to have raised more troubling concerns about the integrity of members of the Force. Why should this be so?

106 In none of the cases drawn to our notice (other than where the release was not deliberate) has the identity of the individuals responsible been firmly established. We were not constituted as a "leak inquiry", but were charged to examine broad trends in behaviour, as well as the integrity of systems governing the handling of official information within the Defence Force and Ministry of Defence; and we have no independent judgement to offer on the precise origin of the leaks, nor on the motives of those responsible.

107 Moreover, the evidence provided to us during the numerous interviews we conducted was by no means unanimous on either point. Opinions as to the identity and motivations of the miscreants were divided; and conclusions, necessarily speculative but stated by some with assurance, were as confidently contradicted by others spoken to.

108 We must, therefore, acknowledge at the outset that, in the absence of firm evidence of individual culpability, we cannot state with certainty why it was that these breaches of discipline and obligation occurred in such number in the past four years. But although the evidence could not be judged totally conclusive, by the end of our investigation, the weight of opinion appeared to point towards one plausible explanation. The following paragraphs set out our best attempt to chart the course of events and the forces which provoked them. It is to be regarded as an hypothesis rather than a proven diagnosis; but we believe it to lie closely enough to the truth to underpin the conclusions advanced in the final section of our report.

109 The aberrant behaviour manifested in an unacceptable level of unauthorised disclosure of official information during the last four years had its roots in two highly significant trends already touched on in paragraphs 20-22 above. These were the run-down in Defence capabilities stemming from a declining Defence budget, and the emergence of clear divisions between the two major political parties as to the purpose and structure of the Defence Forces, and the consequential equipment requirements.

110 For a number of reasons, Defence spending has always been a difficult area for New Zealand Governments, not the least the perceived absence of a clear, direct military threat to the country. Another major challenge has been to accommodate within a limited budget periodic expenditure bulges when very large capital assets, especially for the Navy and Air Force, need to be replaced or upgraded. The period 1997 - 2001 with which we have been principally concerned saw these difficulties converge, as major re-equipping decisions covering all three Services could not be further postponed. They were dealt with first in the last years of the National Government, then reconsidered by the incoming Labour Government with different priorities.

111 During the first phase, up to late 2000, there was intense competition between the three Services for their share of the funding likely to be forthcoming. This competition was initially expressed within established consultative procedures aimed at identifying an agreed priority for new capital projects; but as the process advanced and a Ministerial view began to take shape, it became apparent which aspirations were most likely to be fulfilled and which, at least initially, must be deferred or only partially met. In particular, there were apprehensions on the part of many Army officers that their Service's legitimate claims would not be fully met in this round. Such foreboding appears to have actuated the letter sent by Lt Col. Gordon, then on the Defence liaison staff in London, to the Deputy Chief of the General Staff Brigadier Ottaway in March 1997. (Appendix 9). It was written about two weeks after a CGS seminar in which working groups of middle level Army officers had canvassed many of the ideas advanced in the letter.

112 The "Gordon letter" is currently the subject of a separate inquiry under the authority of the Judge Advocate General. We content ourselves with noting that a number of the officers we interviewed, while not necessarily aware of the existence of the letter before it was tabled in Parliament in 2001, believe in hindsight that it constituted a basis from which some of their fellow officers, perhaps with the assistance of certain retired colleagues, did indeed open the "second front" advocated by Col. Gordon. The strategy defined by Gordon was to -

"attain a level of control over NZDF policy making in order to ensure that the capabilities of the NZ Army evolve in such a way as to be able to meet the future challenges likely to be imposed by Government."

This included ensuring that selected individuals supporting the "two fronts" strategy were selected for promotion to key positions, exploiting "the vulnerability of the air strike capability to the Army's advantage, and lobbying Māori MPs, select committee members, academic institutions and the general public."

113 The Judge Advocate General's inquiry will show how far these ideas were disseminated and acted upon within the Army and disclose the available information concerning the source of the leak of the letter. The important point for us is that a number of Army officers at that time strongly disagreed with an approach which advanced public relations activities into unacceptable territory. It is perfectly appropriate and, indeed, desirable that a Service should maintain a public relations programme designed to disseminate information about its activities as an aid to recruitment, and to wider community understanding of its role. But a fine line demarcates this legitimate activity from the active lobbying of politicians and calculated undermining of the aspiration of other Services. In our view and in those of a number of fellow officers this line was plainly crossed in Col. Gordon's blueprint. "Working outside the square" as one senior Army officer put it to us. It is significant that at this time the public relations firm Communications Trumps, which had a substantial role in the process, was described by a former director as having been involved in an "Army rebranding" exercise.

114 The split in opinion within the Army was exacerbated by a further divisive internal argument over the appropriate future strategy and consequential equipment requirements of the land force. The debate appears to have continued well beyond the point at which final decisions on the matter were taken by the Government.

115 The current Government's decision to reverse its predecessor's decisions in a number of respects, most notably in abandoning the air strike capability and investing more heavily in the Army motorisation project, was clearly disappointing to the Air Force and, to a lesser extent, the Navy. Our inquiries did not, however, produce any evidence or even widespread perception that the rising epidemic of unauthorised disclosures were part of a campaign from within those two Services directed at having the decisions reversed, embarrassing the Government or destabilising senior individuals within the Defence Force. Comments made to the media about the state of morale in the Air Force, for example, were acknowledged to be due to efforts by the media to secure stories rather than any pro-active campaign. Middle ranking as well as senior officers of these Services assured us that all personnel saw it as their duty now to work zealously to put the new policies into effect.

116 Over the past year the origin and the target of the heightened level of unauthorised disclosures have clearly changed. Without firm evidence it is impossible to identify the sources of this later unauthorised flow of documents, or information about the content or existence of documents to Opposition Members of Parliament and to a smaller extent the information media. We encountered a view, within as well as outside Army, that the prime culprits were Army officers, whether in the Army itself, or on the staff of Defence Force Headquarters, or perhaps retired. Their motives were said to be various: support for what they saw as a more balanced Defence Force structure; opposition to some aspects of Army's current policies; determination to destabilise Army leadership; dissatisfaction with lack of promotion. ⁹

117 Initially, this view of Army culpability seemed to us too much of a paradox to be taken seriously. But its repetition and the evidence in some cases that leaked material could only have come from Army sources suggested to us that it might well have greater plausibility than any other likely explanation.

118 It would be wrong to see this inference as indicating widespread disloyalty to the Government. Although the disclosures have plainly caused continuing embarrassment to the Government, they appear to have been aimed primarily at destabilisation of individuals within Army, and at influencing the CDF and CGS appointments. As one senior interviewee put it to us, the aim was to ensure that the "right" people would hold the key positions when the next round of major funding and equipment decisions occurred.

119 Moreover, the group of officers orchestrating the disclosures is considered to be small, and the overwhelming majority of Army officers do deplore the tactics employed. Some informants expressed the hope that this group would be identified and dealt with summarily.

120 Our inquiries have then not established any grounds to conclude that there has been a systemic failure in the behavioural standards of the Defence Force. We were impressed by the integrity and commitment of the serving officers we met and their obvious distaste for the aberrant conduct of a few. Loyalty to the Government, for most, is not at issue. It is in everyone's interest that a stronger attempt should now be made by the new leadership to identify those few who have overstepped the mark and neutralise their ability to do further damage. There are also a number of areas in which we believe improvements in the framework governing standards of behaviour and the handling of official information would help to clarify and reinforce the Government's expectations; and these are addressed in the conclusion section which follows.

⁷ The Armed Forces "cannot be regarded as a uniformed version of other departments of state" because of the intensity of personal and hierarchical relationships that are developed to ensure success in operations. Consequently "loyalties are much sharper than in an administrative department": Thornton LW, "Comment On Major Loorparg's Review of Defence Organisation" in Looparg T. "Defence Reorganisation: A New Approach to Change." Public Sector Research Papers Vol.2, No.1, 1981, p 1.

⁸ cf. Defence Force Order 32/1994 - "The Privacy Act 1993 - New Zealand Defence Force Procedure and Practices" - referred to in our report of 13 December 2001, paras 30-31, 41 and 46.1. To the extent that there was some doubt as to whether paragraph 13(a) in that Order was in the requisite mandatory form we recommended that consideration should be given by CDF to amending it to include a clear prohibition on access to or use of personal information unless required for a lawful purpose.

⁹ As Iago put it in Othello, Act 1, Scene 1 -

"...'Tis the curse of service.

Preferment goes by letter and affection.

And not by old gradation, where each second

Stood heir to th' first."